MOSCOW, Russia --Iraq remained a stumbling block in talks designed to restore pre-Iraq war relations between Moscow and Washington.

U.S. Secretary of State Colin Powell ended talks in Moscow with Russia's foreign minister and President Vladimir Putin Wednesday saying "some outstanding issues" existed over Iraq.

The talks were aimed at rebuilding relations between the two countries after the spat over the U.S.-led war on Iraq. Moscow had said it would not support a second resolution in the U.N. Security Council. ('End war')

Since the war Putin has also called for an international presence in Iraq and for proof that weapons of mass destruction do not exist in the country before passing a resolution which would lift U.N. sanctions against Iraq and bring to an end the oil-for-food program.

Powell said: "With respect to Iraq...there are some outstanding issues, and we will be working on these issues in a spirit of partnership and trying to come to a solution."

He added: "We will be working closely in the days ahead to see if we can come to agreement with our other Security Council partners in passing a resolution that we will use to help the people of Iraq live a better life."

Russia's Foreign Minister Igor Ivanov said Russia did not intend to hamper the U.S. draft, Reuters reported.

"The main thing now is to create a legal basis for broad international involvement in post-war rehabilitation of the country.

"This is our objective. We do not seek to somehow complicate the resolution or to create artificial barriers standing in the way of agreeing a common resolution."

Lifting the sanctions would give the U.S. and its allies the right to sell Iraqi oil and spend the revenue without international supervision.

Russia and France have outstanding oil contracts with the former regime of Saddam Hussein, reached under the oil-for-food program. The fate of those contracts -- which in Russia's case is valued at about $1.5 billion -- remains unclear. Washington says oil contracts are up to the next Iraqi government.

Also on the agenda was plans to arrange a summit between Putin and U.S. President George W. Bush in St. Petersburg for June 1, immediately before the G8 meeting in Evian, France.

A new joint counter-terrorism offensive was discussed too. Powell arrived after witnessing the immediate after affects of a suspected al Qaeda attack in Riyadh in which at least 34 Westerners died. (Full Story)

Chechnya has seen two suicide attacks this week, one in the north of the country where 52 people died when a truck laden with explosives smashed into government buildings Monday.

The second happened at a religions festival Wednesday when a woman set off an explosives belt strapped around her waist, killing about 14 mainly elderly people. (Full Story)

Putin had compared the Riyadh attack with Monday's Chechnya blast.

"The bloody acts of terror in Chechnya and Saudi Arabia can bring Moscow and Washington together," read a headline in the Russian daily Vremya Novostei.

Russia's State Duma made a conciliatory gesture towards improving relations with Washington Wednesday when it answered calls by Putin to ratify the most recent U.S.-Russia nuclear arms treaty.

The so-called Treaty of Moscow, signed by Putin and Bush a year ago, and already ratified by the U.S. Congress, will slash the numbers of deployed strategic nuclear arsenals.

The thorny issue of Russian nuclear technology transfers to Iran was also thought to have been discussed. The United States says the Islamic republic is trying to develop atomic weapons but Tehran says its intentions are peaceful.

Washington says it fears nuclear proliferation will eventually put an atomic bomb in the hands of Islamic militants like the al Qaeda group, which Washington says was behind the Riyadh attacks.

It was the sixth stop on Powell's Middle East and European trip which has been dominated by talks of the so-called Road map, and Washington's promises to start Iraq's transition from U.S. military occupation to Iraqi civilian government.